Mickos: Amazon and Eucalyptus still rule the cloud

Nobody said running a cloud startup was going to be easy. But surely, it was never supposed to be this hard.

Last year, former MySQL man Marten Mickos was named chief executive officier of Eucalyptus Systems, a new company busy building and supporting Amazon-compatible clouds behind the firewall. But just as he arrived, things seemed to slip away from the ideal.

Mickos was appointed CEO in March 2010. His remit was to transform Eucalyptus from an academic outfit that had built an open source cloud platform into a professional IT company with proper development processes and paying customers. The VCs that tapped Mickos included Benchmark Capital, where Mickos had served as an "entrepreneur in residence" after he left Sun Microsystems and MySQL.

Four months in, one big name Eucalyptus customer - NASA - dropped Eucalyptus and joined Rackspace in founding a rival elastic computing fabric and storage platform. This was OpenStack.

NASA has used Eucalyptus for Nebula, a geektastic compute cloud meant to chomp on more than 100TB worth of images from the WorldWide telescope, but it switched to project to new software that would be folded into OpenStack.

NASA's walk-out sparked a debate over whether Eucalyptus is genuinely open to outside participation even though it's available under not one but two open-source licenses: GPLv3 and BSD. Since the founding of OpenStack, more than 60 companies – including Microsoft, Dell, Cisco, and Canonical – have signed on as OpenStack partners, embracing the promise of a truly open-source cloud project.

Then, last week, Eucalyptus took a more personal hit. Members of Mark Shuttleworth's cuddly Ubuntu Linux distro project decided that future releases of Ubuntu Server, including the 11.10 release due in October, would support OpenStack and not Eucalyptus.

The sting was made all the sharper given the fact that Ubuntu was such an early backer of cloud computing, the first Linux to include Amazon Machine Images (AMIs). The personal part? Billionaire Shuttleworth had been a Eucalyptus investor. After the rise of Openstack, it was Shuttleworth who told the Ubuntu faithful it was make-up-your-mind time: Eucalyptus or OpenStack. "Tighten up and make some firm decisions about the platforms we can support for 12.04 LTS." And they made up their minds for OpenStack.

It's not the end of the affair. Eucalyptus will still be available for download with Ubuntu. But Canonical's engineers are now focused on making sure that Ubuntu servers are tuned to OpenStack. They won't spend their time on Eucalyptus.

Talking to The Reg at the Open Source Business Conference (OSBC) in San Francisco, California this week, Mickos disagreed when we suggested the pendulum is now swinging against Eucalyptus and its Amazon-compatible model.

Two years back, if somebody said the word "cloud", the first thing that likely jumped to your mind was Amazon. Say "cloud" today, and you could be talking OpenStack, Microsoft's Azure, or Google's App Engine. But Mickos believes that Eucalyptus and Amazon still hold an advantage.

"I think our founders were super brilliant in picking the Amazon API and back then, it was a guess - they made a bet," Mickos said "Today, Amazon has market share of 60 to 70 per cent. It is the de-facto API, and it reflects on the private cloud side. Even customers who come to us and say 'We will not use Amazon' want the same."

He concedes, however, that the job has become harder. "When I joined, it was a very small team very focused on technology. We had to bring in new people to start operating as a company. Then the market suddenly became immensely crowded - every month there is a new company," he said.

Purists versus pretenders

Mickos believes Eucalyptus has the advantage of being one of the first cloud computing businesses. This makes the company a purist rather than a pretender, he says. "The founding team had the blessing of being the only ones there – we had to figure out our position and to comment about other vendors which have never had to do it before."

That purity? An Amazon-compatible cloud that doesn't try to compete with Amazon itself. It lets you move to Amazon when you're ready and move back again. You can build a cloud that spans both Eucalyptus and Amazon.

But what about the loss of Ubuntu and such a well-known personal investor? Mickos thanks Shuttleworth for his investment money and two years of good publicity. "It was good for us. We got users to experiment with us," Mickos said. But he claims that Eucalyptus made practically no money from the relationship. No hard feelings then.

Mickos says that there isn't one Eucalyptus customer running on Canonical's Ubuntu Enterprise setup, that customers are instead using Eucalyptus on plain-old Ubuntu. The former uses the Ubuntu Landscape tool to pool Ubuntu servers or toss images onto Amazon. The latter is, well, just Ubuntu. "When we run in production, it's mostly CentOS or Red Hat," he says.

What about OpenStack? Nearly a year after OpenStack was announced, Mickos reiterates that Amazon - and by extension Amazon-compatible clouds such as Eucalyptus - are still the primary game in town.

OpenStack consists of two basic platforms: Compute and Object Storage. The storage piece has been deployed on at least one commercial service, and much the same code back Rackspace cloud storage service. But at the moment, it seems that NASA is the only big name using the Compute piece "in production". To help accelerate development, Rackspace has bought Anso Labs, a small company that helped build the compute piece for NASA.

Mickos says that while customers had issues with the Eucalyptus software a year ago, it's no longer right to say Eucalyptus is difficult to install or scale.

"We continue to be the only production-ready cloud platform already out there. You can make lots of statements and lots of plans and do all kinds of things, but when you go to production there are very few alternatives out there, and we are there," he said.

Some have questioned OpenStack's official status as a vendor-neutral operation. The acquisition of Anso gave it control the project's board, but the company has moved to expand the board to other players. Mickos is among those who believe that Rackspace should have been clearer in its intentions.

But Eucalyptus has its own burden to carry. Eucalyptus might be open-source, but it uses something called an open-core model. Translated: There's a free community edition of Eucalyptus for everybody, but more advanced features beyond the basic stuff only go to paying customers.

This is exactly the model Mickos employed at MySQL, and it upset people then too.

Open source or open core?

Open-core became a talking point when NASA dropped Eucalyptus and went with OpenStack. According to NASA, it wanted changes made to the code, but Eucalyptus was unwilling to make them. Mickos tells a different tale. He says the sticking point was that NASA had a problem signing away copyright and wanted changes to the Eucalyptus contributor agreement before it would submit code. Mickos says Eucalyptus made changes to its contributor agreement, but then NASA went silent and didn't follow up.

"When somebody contributes to us, we require them to sign over copyright, but so does the FSF [Free Software Foundation] and Ubuntu. There's nothing new in that. If somebody contributes something significant, we pay them money so they can make real money.

"We don't see it as an issue there and we think it's important to have the copyright well managed. It's a part of our governance model. We've told the world this is how we operate, we are in charge the roadmap and we require copyright sign over when people contribute," Mickos said.

Mickos hints at a more prosaic reason for the breakdown between Eucalyptus and NASA. That Eucalyptus was still a relatively small technology-focused shop of just 15 engineers, unprepared to handle something like customer service. Today, Eucalyptus has 55 staff, and meetings every Monday open with an update on any customer's issues, bugs, and bug fixes. "Maybe we didn't remind them, we didn't reach out and call out and say: 'Hey guys where are you?' because we were small then," Mickos said. "We have made sure as an organization we are more out reaching."

Open core might have bothered the boffins inside NASA, but it has not stopped others from downloading the software or even paying Eucalyptus for those more enterprise-y features.

Mickos won't say how may paying customers Eucalyptus has, but he claims there are 25,000 Eucalyptus clouds, and he says you should divide this by 100 to get the number of paying customers. This is a classic smoke and mirrors tactic from open-source companies, who like to talk uptake rather than paying customers. The company is growing, but it's not making a profit, Mickos admits.

Those people using Eucalyptus are running it on thousands of hardware servers, and this means it's on a larger number of virtualized servers. The latest customer is European social network gaming site Plinga, who Mickos claimed runs hundreds of servers and is doubling its server footprint every six months.

Recently, the company's bruised ego received another fillip. Eucalyptus was invited to join the anti-VMware, pro-KVM hypervisor party started by IBM and Red Hat: the Open Virtualization Alliance, also announced this week at OSBC. So far, Eucalyptus is the only pure cloud player on-board, although the Alliance says that more companies can't wait to join up.

"They invited us to this because they know we have the widest installed based of all cloud platforms," Mickos said.

We don't know who said what to who or how it really went down, but there is a pay-off for Eucalyptus. The Alliance is a big marketing push for KVM against VMware by companies with cash and contacts: IBM, Intel, Hewlett-Packard. Both may help Eucalyptus gain entree into new, bigger customers in the enterprise, gaming, mobile, and government markets.

Mickos just spent twelve months getting Eucalyptus into shape. The company has improved its technology and documentation, begun a professional services operation, and has a version 3.0 due that uses algorithms to continuously check the health of an Amazon cloud and run failover should it spot a problem. "We are on a completely different level," Mickos says.

But for all this work, more lies ahead if Mickos and Co. are to make it big. While Amazon still dominates the cloud, the web's honeymoon with the service is over, and devs have more choices of technology and development model than before.

Mikos, who helped build his former venture MySQL into something considered worth $1bn, is philosophical but positive. "Building a big successful business is not about one step, but about taking many useful steps and getting a small victory here and a small victory there, and that’s what adds up," he says. ®